AAPL, GOOG, BRCM Tops in Credit Suisse’s ‘Wearables’ Weltanschauung

By Tiernan Ray

Credit Suisse semiconductor analysts John Pitzer, Kulbinder Garcha, Christian Buss, and Stephen Ju today offered clients an overview note on what they think is “the next big thing,” the rise of sophisticated wearable technology, such as smart watches, and other accessories.

The authors contend that while “wearables,” as they call them, are “not new,” nevertheless, they are “at an inflection point in market adoption” because there is a growing installed base of smartphones, cost and performance improvements are coming in components, there is more mature software to run them, and there are new business models for them.

The wearables market is a lot bigger than investors realize, they contend, at perhaps $3 billion to $5 billion today, rising to perhaps $30 billion to $50 billion over the next three to five years.

There may be upward of 15% of smartphone owners who end up buying a wearable, the authors opine, for perhaps 6% share of the total global electronics market.

Bottom line, the authors think wearables are “a mega trend” and that “your clients need to care” because the gizmos may have “a significant and pervasive impact on the economy,” change how we all interact with technology, and may “advance Big Data paradigm from unstructured to what has been to uncollected data.”

In several slides, the authors tie the smartphone to wearables as the “hub” through which various technologies interconnect, such as the “802.11ac” standard for high bandwidth, short-range WiFi connections, and “near-field communications,” or NFC, for mobile payments.

They offer one graphic with a gaggle of supposed wearables, some of which you may remember (click for larger image):

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There are 8 comments

MAY 17, 2013 7:10 P.M.

MikeC wrote:

I saw a promotion that sells a GPS-equipped Garmin watch with a heartbeat monitoring system at around $400. I thought I would spend that money for purchasing a smartphone watch if it is available. Garmin is demonstrating there is a market for such device. I look forward to seeing more wearable computer devices.

MAY 18, 2013 3:06 A.M.

FaceBook, man. wrote:

Where's the BUTT PLUG?!

A web enabled device that sends and receives anal-e-grams so the user experience can be globally synced...

Nick Denton

MAY 19, 2013 8:31 A.M.

Anonymous wrote:

Great....

MAY 20, 2013 11:07 A.M.

Your Editor wrote:

relaize -> realize

MAY 20, 2013 11:11 A.M.

Tiernan Ray wrote:

Your Editor: Thank you for pointing out the typo.

MAY 28, 2013 7:14 A.M.

Clara wrote:

Do you know where can I find the report?

Thanks

MAY 28, 2013 6:09 P.M.

ReedK wrote:

This has been referenced everywhere on web yet no access to the report?

MAY 29, 2013 10:24 A.M.

Tiernan Ray wrote:

ReedK: Credit Suisse do not disseminate their reports for public access. Reporters are able to quote from them but not to post the report in its entirety.

About Tech Trader Daily

Tech Trader Daily is a blog on technology investing written by Barron’s veteran Tiernan Ray. The blog provides news, analysis and original reporting on events important to investors in software, hardware, the Internet, telecommunications and related fields. Comments and tips can be sent to: techtraderdaily@barrons.com.